Kid Brands Earnings Preview

Kid Brands (NYS: KID) will unveil its latest earnings on Monday. Kid Brands, through its subsidiaries, is a designer, importer, marketer, and distributor of infant and juvenile products.

What analysts say:

Buy, sell, or hold?: Analysts are very bullish on this stock, unanimously backing it as a buy. Analysts like Kid Brands better than competitor JAKKS Pacific overall. Three out of eight analysts rate JAKKS Pacific a buy compared to two of two for Kid Brands. Analysts' rating of Kid Brands has stayed constant from three months prior.

Revenue forecasts: On average, analysts predict $64.6 million in revenue this quarter. That would represent a decline of 9.2% from the year-ago quarter.

Wall Street earnings expectations: The average analyst estimate is earnings of $0.10 per share. Estimates range from $0.09 to $0.11.

What our community says:CAPS All-Stars are solidly backing the stock with 84.6% granting it an outperform rating. The majority of the Fools are in agreement with the All-Stars as 69.6% give it an outperform rating. Fools are bullish on Kid Brands, though the message boards have been quiet lately with only 24 posts in the past 30 days. Kid Brands' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:Revenue has fallen in the past two quarters. The company's gross margin shrank by 6.7 percentage points in the last quarter. Revenue fell 11.2% while cost of sales fell 2.7% to $46 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

23.8%

27.2%

21.6%

29.0%

Operating Margin

2.6%

1.5%

1.2%

9.7%

Net Margin

(6.6%)

(0.4%)

30.3%

5.6%

One final thing: If you want to keep tabs on Kid Brands movements, and for more analysis on the company, make sure you add it to your watchlist.